Worden Capital Management, LLC, is a Garden City, New York company that provides client focused investment pathways that aim for consistent returns over extended time frames. As a registered broker dealer, Worden Capital Management, LLC, emphasizes proactive risk management that prepares clients for extraordinary events and challenging market environments.
One valuable way of assessing risk centers on alpha and beta measurements, which enable securities to be compared and selected for specific portfolios. Alpha focuses on the return of the entire portfolio, against returns provided by the S&P 500 or another benchmark index. Often used in evaluating mutual funds, it indicates whether the fund is, on balance, under-performing or outperforming the index. Positive alphas indicate a fund that historically provides better returns than the benchmark.
By contrast, beta focuses on relative volatility of a specific investment compared to the entire index. Stocks with a higher beta tend to be riskier, but also have potential for higher returns. Lower beta stocks suit a conservative portfolio, although they deliver lower expected returns. Through calculating beta on specific stocks, even those that are part of a larger fund, investors align holdings to suit overall risk tolerance.
Keep in mind that both alpha and beta are considered in tandem with a range of other fundamental and technical analytics tools that may affect ultimate investment decisions.
One valuable way of assessing risk centers on alpha and beta measurements, which enable securities to be compared and selected for specific portfolios. Alpha focuses on the return of the entire portfolio, against returns provided by the S&P 500 or another benchmark index. Often used in evaluating mutual funds, it indicates whether the fund is, on balance, under-performing or outperforming the index. Positive alphas indicate a fund that historically provides better returns than the benchmark.
By contrast, beta focuses on relative volatility of a specific investment compared to the entire index. Stocks with a higher beta tend to be riskier, but also have potential for higher returns. Lower beta stocks suit a conservative portfolio, although they deliver lower expected returns. Through calculating beta on specific stocks, even those that are part of a larger fund, investors align holdings to suit overall risk tolerance.
Keep in mind that both alpha and beta are considered in tandem with a range of other fundamental and technical analytics tools that may affect ultimate investment decisions.
